Business News: Chesapeake Energy settles case amidst bankruptcy.
Chesapeake Energy, the country’s second largest natural gas producer, has reached a settlement with the Pennsylvania Attorney General’s Office, ending a lawsuit over inadequate royalty payments.
Attorney General Josh Shapiro stopped by in Wyoming County on Monday to make the announcement. Shapiro says landowners who rented in Chesapeake were sometimes billed or royalties withheld to pay for the company’s gas collection, transportation, and processing costs.
“This company told Pennsylvania residents that natural gas production would be profitable for them. It didn’t come close to what was promised or, at times, it didn’t make any money at all, “said Shapiro.
The deal will provide better royalties for landowners renting to Chesapeake in the future, as well as better protections and $ 5.3 million in restitution for those affected.
The company then appealed the decision and in March 2019 the Commonwealth Court of Pennsylvania again found the defendants and their oil and gas leasing practices were subject to the UTPCPL. The defendants appealed to the Pennsylvania Supreme Court, which conducted oral arguments in May 2020.
On June 28, 2020, Chesapeake filed for bankruptcy in the United States Bankruptcy Court for the Southern Texas District, Houston Division. The bankruptcy court suspended the Pennsylvania Supreme Court case against Chesapeake so it couldn’t move forward.
On February 9, 2021, Chesapeake emerged from bankruptcy, but an injunction has been put in place that continues to prevent the Attorney General’s office from go ahead with this case and get the restitution that the landowners deserve. The case against Anadarko is pending a decision by the Pennsylvania Supreme Court.
“For years, Chesapeake has tried to publicly pressure my office to settle on their terms. It didn’t happen, “Shapiro said.” They tried to argue that our court action was withholding settlements in a separate, private class action lawsuit filed directly by the landowners … None of this was necessary; they didn’t have to. act in this way, and the fact of the matter their conduct revealed their contempt and mistreatment of the people here in northeastern Pennsylvania and the Northern Tier. “
“Chesapeake greatly appreciates its relationships with Pennsylvania royalty owners and is delighted to have reached a global resolution with them and the Attorney General addressing the concerns of royalty owners. The Company looks forward to partnering with Pennsylvania Royal owners in the future. The global agreement is subject to the approval of the bankruptcy court. “